Mentioned in the Domesday Book of 1086, the town has evidence of continuous settlement from the Neolithic period and is locally reputed to have been the last refuge of Boudica as she fled from the Romans. The parish of Chatteris is large, covering 6,099 hectares, and for much of its history was a raised island in the low-lying wetland of the Fens. Following the draining of the Fens, beginning in the 17th century and completed in the 19th century, the town has become a centre of agriculture and related industry.

According to the United Kingdom Census 2001, the town has a population of 8,820, although this is likely to be much higher due to extensive housing developments since the census was taken. Furthermore, due to its proximity to Cambridge, Huntingdon and Peterborough, the town has emerged as a commuter town.